Priced Out Of Your Medication? Must Be All That 'Expensive' Big Pharma R&D

from the actually,-it's-the-bullshit-that-costs-so-damn-much dept

A few months ago, the pharmaceutical industry was throwing around careless numbers to justify the exorbitant price of its products. The "industry standard" of $800 million to develop a new drug had inflated to $1.3 billion (presumably thanks to non-existent inflation), but some digging around in the very same dataset produced a completely different number: $35 million. Sure, that's not exactly "walking around" money, but it's a lot easier to recoup your investment if you don't overstate it by $1.26 billion.

Some more damning numbers have emerged in a post at Rational Arguments, showing that even the drug companies' inflated R&D costs pale in comparison to what they really spend their money on. The first post pulls numbers from the Fortune 500 listing of top 10 pharmaceutical companies (by sales) and finds some (sadly) unsurprising results:

Those companies spent a whopping $41 billion on research and development. That's a lot of money. But it's significantly less than the $49 billion (18%) in profit they made. Just so you know, the average Fortune 500 company in 2008 made 0.9% of sales in profits. So in a recession, pharma did very, very well. [The] pharmaceutical companies spent $83 billion on marketing and administration. That's more than twice as much as they spent on research and development. That's an insane amount.

So it's a little disingenuous to claim that Americans must continue to spend so much to fund R&D when you could make cuts to either profits (which are big) or to marketing and administration (which is gargantuan). R&D just isn't that big a piece of the pie. There's plenty of fat to trim in there before research and development.

And why do pharmaceutical companies spend so much on marketing? It's simple, really. They're not creating new drugs. (Yes. That seems like a really moronic explanation, but read on...)

From 2000-2007, 667 new drugs were approved by the FDA. Of those, only 75 (11%) were new molecules that were much better than what we already had. In fact, over 80% of all drugs approved were no better than what we already had. Those are "me-too" drugs. Why do the pharmaceutical companies spend so much on marketing? Because you have to really promote drugs that really have no benefit over others that already exist. You have to convince people to buy those.

You know what needs no promotion? Awesome new drugs that save lives. When was the last time you saw a commercial for chemotherapy? For epinephrine? For steroids? Those drugs need no promotion - doctors just know to use them. But I bet all of you know about Nexium. Or Cialis.

Add to that the fact that drug companies are now helping themselves to medical records to help "guide" doctors' decisions and you've got a cyclical nightmare that increases costs while doing next to nothing for the health and well-being of their customers.

If you've managed to keep your incredulous rage (and whatever meal you last digested) suppressed, here's some more evidence dismissing pharma's everlasting claim to what's left in your wallet.

The Incidental Economist has a followup post by Aaron Carroll (who wrote the previous post at Rational Arguments), detailing even more evidence that the drug industry is blatantly lying when it claims its high prices are justified by its R&D investments. The twist here is that these companies, for the most part, aren't even doing their own R&D. (Click through for an informative and highly irritating graph. The colors are nice, though...)

The majority of research cited in patent applications was done in academic centers. Some more was done in other non-profit or government research centers. Only 15% of the research was done by industry. That's not a very compelling argument for the indispensable contribution of industry to research.

Carroll quotes another study, this one performed by Public Citizen in 2001, which showed that "U.S. taxpayer-funded researchers conducted 55 percent of the published research projects leading to the discovery and development of these drugs (and foreign academic institutions 30 percent)." In fact, drilling down even further into the data reveals that only one in seventeen papers come from the industry itself.

What we've got is an industry that uses the research (and money) of others to keep its profit margins right where it wants its. Even worse, it keeps going back to the government, fur-lined pimp hat in hand, looking for more funding, more patents, more patent extensions and more control over the medical community. Anyone looking to the pharmaceutical "community" for an answer to their health problems is in for a world of very literal hurt. The industry doesn't seem to mind if you're chronically ill. It just hates losing paying customers. To, like, death and stuff. And so it lowers its costs and raises its prices, trying to find the perfect balance between lifelong medical care and the local morgue.


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  1.  
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    Richard (profile), Jun 28th, 2011 @ 3:48am

    Drug companies next in line for obsolescence

    When the combination of nanotechnology and gene technology really gets going the concept of stuffing you body full of chemicals to cure a disease will seem really old fashioned!

     

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  2.  
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    FM Hilton, Jun 28th, 2011 @ 3:55am

    It is of course about profits.

    The drug companies have been in a slump for the past 5 years, and are desperately looking for ways to maximize their profits-by advertising drugs that have generic equivalents that do as well if not better than the brand.

    It's also a little known fact that drug companies pay generic makers to keep their versions off the shelf.

    It's legal, and it should not be-but it's big business.

    The drug companies' R & D expenses are nothing when you consider that most of their research is done by public entities like universities and medical centers.

    The public just doesn't understand that the drug companies are in it for the money-not the 'life-saving' or life extending products they promote.

     

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    out_of_the_blue, Jun 28th, 2011 @ 4:13am

    Good to see a little populist outrage /here/.

    The whole of "health care" is another of the intractable problems that have one simple root cause: chasing /money/ (and power) rather than producing /goods/. The solution is obvious: start putting an upper limit on incomes, take /money/ out of the motives.

    When I was a youth, we were so rich and influential that when I contracted measles, one of the leading physicians in the county dropped all else to rush to our home and give me a shot. Today there are probably fifty times as many "doctors" around, yet I doubt that even the richest ever get a house call -- I had to pause to recall the term, it's been so long since I heard it.

    By the way, many doctors are invested in pharmaceutical businesses, besides all the other industry, they're not just unwitting pawns.

     

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    DCX2, Jun 28th, 2011 @ 4:28am

    Re: Good to see a little populist outrage /here/.

    The solution is obvious: start putting an upper limit on incomes, take /money/ out of the motives.

    But that's socialism! If you prevent people from making many countless millions of dollars each year, what incentive will they have to screw people over?

     

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    abc gum, Jun 28th, 2011 @ 4:41am

    Ask your doctor whether you are being screwed with a big pharma. Warning, there may be some side effects from asking this question; dizziness, nausea, or death may occur.

     

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  6.  
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    Blatant Coward (profile), Jun 28th, 2011 @ 4:45am

    Re: Drug companies next in line for obsolescence

    "Cure"??? Medics don't cure, they aid and abet the body so it can wipe out/heal the issue or simply remove a problem surgically/chemically.

    They are no better than PC techs other than they've has a thousand years of 'tradition' and advertising.

    And before you yap about the smallpox cure, it is still out there,and that wasn't a cure, that was simply viral genocide.

     

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    Anonymous Coward, Jun 28th, 2011 @ 5:00am

    Re: Re: Good to see a little populist outrage /here/.

    What motive would they have to do anything if they would not profit from it? out of the good of their hearts? please don't tell me you are that naive

     

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    A Monkey with Atitude, Jun 28th, 2011 @ 5:07am

    Re: Good to see a little populist outrage /here/.

    yea those "wealthy people" have got to go, they's EVIL i tell ya.... hmmm who does that sound like? Mao? Stalin? V. Lenin? Pol Pot? (FYI 3 of the largest mass murders in history are in that list)

    Yea that worked out well in the past how can it fail...

    How about set standard regs. for the industry and the government actually enforce the regs (honesty in advertising, in healthcare QC Controls, in healthcare Cures not treatment).. maybe a different path than the 2 we have seen tried again and again and failed for citizens every time...

     

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    Anonymous Coward, Jun 28th, 2011 @ 5:08am

    [quote]Carroll quotes another study, this one performed by Public Citizen in 2001, which showed that "U.S. taxpayer-funded researchers conducted 55 percent of the published research projects leading to the discovery and development of these drugs (and foreign academic institutions 30 percent)." In fact, drilling down even further into the data reveals that only one in seventeen papers come from the industry itself.[/quote]

    This is a poor metric to use. I'm not saying that they do all their own research, or even most, but industry (regardless of what industry) publishes at a MUCH lower rate than academia. For industry, it's usually the last thing they look at doing (and it is sometimes actively discouraged for competitive reasons) while it's the main metric used to judge performance of professors and is actively selected for.

     

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    Chronno S. Trigger (profile), Jun 28th, 2011 @ 5:15am

    Re: Re: Re: Good to see a little populist outrage /here/.

    People like that do exist and there are more of them then you thing. There just aren't nearly enough to make that kind of idea work. I know quite a few doctors that got into it just to help people. I know way, way more who got into it for the exclusive reason of money.

     

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    Nicedoggy, Jun 28th, 2011 @ 5:16am

    How much of all of this is our fault?

    We let them do it, why are people not creating their own health centers and focusing money into research that could benefit all of us?

    How can we make the money go to places that are truly necessary? how to make cheap drugs? how to create community health centers?

    Those are the questions I'm most interested in.

     

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    Michael Lockyear (profile), Jun 28th, 2011 @ 5:53am

    If you think that there is easy money to be made in pharma...set up your own drug company...better yet setup a non-profit drug company. Or move to Cuba.

     

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    MadMaxx (profile), Jun 28th, 2011 @ 5:59am

    A different solution

    The main flaw in the Tax the Rich argument is that it doesn't work - they cheat, leave, or corrupt the law (notice the current state of affairs)

    The answer is to eliminate artificial scarcity and stabilize the population.

    Decentralizing manufacturing and open sourcing it addresses the first concern, given that american STILL throw away enough non-recycled Aluminum, Steel, and Glass to meet the auto industries needs every day and enough additional Aluminum to replace all domestic aircraft every 3 months
    (Trash Trivia http://www.co.cass.in.us/ccswd/trivia.htm)
    There are NO shortages of ANYthing that the marketing minds do not create as a perception i.e. "old is bad" etc...

    Local level recycling would reduce the worldwide demand for raw materials by up to 90% for most manufactured materials

    I'm working on an open source system to address these issues called CubeSpawn-> http://www.cubespawn.com and there is no reason to believe we could not have a society that did not need currency in 10 years if we devoted ourselves to building it - and health would become an entirely different pursuit in that kind of environment.

    though idealistic and somewhat simplistic James Hogans "Voyage from Yesteryear" is probably the best fictional treatment of a post scarcity culture I have read... Read it! you might like it ;-)

     

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  14.  
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    Kevin (profile), Jun 28th, 2011 @ 6:02am

    Good post, Tim

    I don't mean to sound backhanded, and I sincerely apologize if I do, but sometimes your posts are a little over the top for me. I really enjoyed this one. I think I like the more subdued-outrage style for Techdirt, rather than some of the Cracked.com-esque posts I've seen from Tim-squared in the past. :)

     

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    Richard (profile), Jun 28th, 2011 @ 6:05am

    Re: Re: Re: Re: Good to see a little populist outrage /here/.

    People like that do exist and there are more of them then you thing. There just aren't nearly enough to make that kind of idea work.

    However it is in the interests of the majority to make it work. The statistics of income distribution at ALL levels mean that your community of interest is always with those on lower incomes than yourself - never with the wealthier - yet so many people foolishly vote for parties that promote the interests of the better off at their expense. The reason why they do this is that most of the MSM are in the pockets of the wealthy. In the medium term ( perhaps the next 20 years) the internet will change that. At present only a relatively small proportion of the population (young/educated) are truly in the internet age - but that will change....

     

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    Richard (profile), Jun 28th, 2011 @ 6:14am

    Re: Re: Good to see a little populist outrage /here/.

    yea those "wealthy people" have got to go, they's EVIL i tell ya.... hmmm who does that sound like? Mao? Stalin? V. Lenin? Pol Pot? (FYI 3 of the largest mass murders in history are in that list)

    Yea that worked out well in the past how can it fail...


    None of those people you quoted has actually tried it. What they did was to hijack the efforts of others for their own aggrandisement. They also all broke the golden rule of such an enterprise - which is that the ends do not justify the means.

    If you want see how it CAN work look at the Mondragon Co-operatives and the John Lewis Partnership.

     

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  17.  
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    art guerrilla, Jun 28th, 2011 @ 6:18am

    Re: further perfidy of big pharma...

    1. they *also* 'hide' a lot of marketing bullshit as 'r&d' money... for example, the color, shape, or other characteristics of pills & medications and how they are 'presented to the patient' are *perhaps*, arguably a subject of *some* 'research', but *mostly* that is really marketing bullshit...
    should we make viagara blue or pink ? uh duh, blue...
    there, i saved you 50 millions in 'research'...

    2. as commented upon in the article and by you, big pharma manages to leverage their grant money to the research universities, etc, to control the parameters of research, squelch 'negative' results, and otherwise own the process and proceeds...
    WE ALL provide the infrastructure, pay for the labs, pay the profs and grad students, and big pharma reaps the benefits of that system by paying pennies on the dollar for the value received...

    3. judging by the number of big pharma drugs i see constantly advertised on the tee vee, i bet they spend more on tee vee ads alone than all their 'r&d' budgets...

    art guerrilla
    aka ann archy

    artguerrilla at windstream.net

    eof

     

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    Anonymous Coward, Jun 28th, 2011 @ 6:29am

    Re: Drug companies next in line for obsolescence

    Sadly, most of this technology will be developed in other countries. Too many (IP and other) laws in the U.S. to allow any actual innovation.

    Or if it gets developed in the U.S. it will be developed using taxpayer money and the patents will then be turned over to the private sector.

     

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    Anonymous Coward, Jun 28th, 2011 @ 6:47am

    Wow, I hope these guys aren't accountants, otherwise the business world is going to hell.

    They said: "Those companies spent a whopping $41 billion on research and development. That's a lot of money. But it's significantly less than the $49 billion (18%) in profit they made."

    Yup, research and development is their only operating cost. No other costs at all. The lights stay on by themselves, the admin people work for free in an office provided by the state, they don't have to pay taxes, and they most certainly don't have any other expenses except R&D.

    One read of the story and you can see it's a wild attempt to slam pharma with half truths and misleading information.

     

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  20.  
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    Nicedoggy, Jun 28th, 2011 @ 6:48am

    Re:

     

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    Nicedoggy, Jun 28th, 2011 @ 6:49am

    Re:

    There is another post awaiting moderation with a small list of other initiatives that people can support if they so wish to do so.

     

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    Greg G (profile), Jun 28th, 2011 @ 6:51am

    Local level recycling would reduce the worldwide demand for raw materials by up to 90% for most manufactured materials

    Really? 90%? That a big claim. Got a source for that?

     

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  23.  
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    Nicedoggy, Jun 28th, 2011 @ 6:54am

    Re:

    http://medicalxpress.com/news/2011-06-clinical-epilepsy-drug-purely.html

    Like the faux clinical trial that was designed to just improve sales of a drug?

    Quote:
    Yale School of Medicine researchers have found that a clinical trial of the epilepsy drug gabapentin may have been a "seeding trial" used by a pharmaceutical company to promote the drug and increase prescriptions, according to a report in the June issue of Archives of Internal Medicine.


    Yah one can see why people are slamming the drug industry and being unfair :)

     

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  24.  
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    KellyV, Jun 28th, 2011 @ 7:00am

    A fine example

    A great illustration of the sad joke Big Pharma has become is progesterone--a simple, naturally-occurring hormone used often in high-risk pregnancies to avoid premature birth. It's effective, and it's cheap--or it WAS cheap, anyway, until the FDA granted a license for one pharma corp to release a branded version of it and run off anyone selling non-branded versions. They also jacked up the price from around $10/dose to $1,500/dose. You read that right, a 150x increase. What's the reason for such a drastic price increase? Clearly there was no R&D cost involved for them--the drug has been variously used for decades and effectiveness studies have been funded by the government. It's really the equivalent of someone coming along and saying no one else can sell generic aspirin anymore, so now if you want aspirin it's going to cost you $5k for a bottle. At some point free-market capitalism really does become highway robbery.

     

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    FormerAC (profile), Jun 28th, 2011 @ 7:02am

    Re: Drug companies next in line for obsolescence

    Are you really that naive? When nano-tech gets rolling, someone will develop a little nano-bot that automatically regulates your immune system and keeps you perfectly healthy. As long as you can afford the monthly payments. If you can no longer afford the payment, or are late, the nano-pharma-tech company sends the command and the nano-bots deactivate themselves. Since bots that have been deactivated cannot be reactivated (DMCA anti-circumvention violation!), you will have to pay the inital fee of $absurd again to have new bots injected.

    Of course, don't forget that there will be technical glitches which accidentally deactivate the bots of anyone who votes against their legally purchased gov't officials, or protests against pharma etc., etc.

     

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    FarSide (profile), Jun 28th, 2011 @ 7:39am

    Re: A fine example

    You have the right answer, but then you strangely slam 'free-market capitalism' at the end.

    "until the FDA granted a license for one pharma corp to release a branded version of it and run off anyone selling non-branded versions"

    What part of that statement is "free-market"?? That's the definition of corporatism.

    If the FDA didn't have the power to so heavily regulate everything, the rich companies wouldn't be able to buy them off (because there would be nothing to buy...)

    Some actual competition may then happen, and prices wouldn't be so out of control.

     

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  27.  
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    MarkT, Jun 28th, 2011 @ 7:55am

    you can't compete agains Big Pharma..

    "If you think that there is easy money to be made in pharma...set up your own drug company..."
    What, an individual compete against the establishment? The pharmaceutical companies OWN the FDA. Just look at Dr. Burzynski. The guy has patents on a *working* cure for multiple forms of cancer but BIG Pharma funded FDA repeatedly kept trying to shut him down until eventually they just stole his patents and helped other pharma companies instead. Incredible.
    http://www.burzynskimovie.com/

     

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  28.  
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    Richard (profile), Jun 28th, 2011 @ 7:57am

    Re: A fine example

    The problem of capitalism is that most of its protagonists don't actually believe in it!

    When they are just starting out they may hail the virtues of free competition - but once they start to get somewhere they start trying to engineer a monopoly.

    Free market capitalism. A system where companies compete to create a monopoly...

     

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    Richard (profile), Jun 28th, 2011 @ 8:04am

    Re: Re: A fine example

    If the FDA didn't have the power to so heavily regulate everything, the rich companies wouldn't be able to buy them off (because there would be nothing to buy...)

    Free market capitalism is unstable - it tends to concentrate wealth (and hence power) in a few hands. Once that occurs a degeneration into corporatism is inevitable.

    Ideally the government should regulate the system to keep the competition fair - but the risk of regulatory capture is ever present.

     

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    Joe K (profile), Jun 28th, 2011 @ 8:06am

    Re: Re: Re: Good to see a little populist outrage /here/.

    When I lived in Germany, insurance companies had a limit on yearly profits. If they mad too much, customers got a rebate. It really does work. Companies have an incentive to make a profit, but not to the extent of really screwing people. However, I don't see how we can implement it as long as our government is "owned" by industry.

     

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    Huph, Jun 28th, 2011 @ 8:07am

    Re: Re: Drug companies next in line for obsolescence

    They are no better than PC techs other than they've has a thousand years of 'tradition' and advertising.


    And people around here claim that musicians think they're special. Yeesh. Get over yourself.

     

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    Anonymous Coward, Jun 28th, 2011 @ 8:10am

    I think I am going to be sick....

     

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  33.  
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    Anonymous Coward, Jun 28th, 2011 @ 8:24am

    Re: Re:

    "may have been", and doesn't address my point in the slightest. Welcome to misdirection. Did you learn that from Marcus?

     

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  34.  
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    Anonymous Coward, Jun 28th, 2011 @ 8:48am

    Government Monopolies

    So, what do you expect? This is just what you get from government granted monopolies. Fools.

    Abolish patents.

     

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    Hephaestus (profile), Jun 28th, 2011 @ 8:56am

    Re: Re: Re: Re: Good to see a little populist outrage /here/.

    In the US it's called being a not for profit. The entire health care and health insurance industries should be that way. It would solve alot of problems and reduce costs substantially.

     

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  36.  
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    Hephaestus (profile), Jun 28th, 2011 @ 9:00am

    Re: A different solution

    I love Hogans books!!! also thanks for the cubespawn link.

     

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  37.  
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    Hephaestus (profile), Jun 28th, 2011 @ 9:05am

    Re:

    here is another one for you ... the bottle caps we throw away every year is more steel than goes into new cars manufactured in the US.

     

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  38.  
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    ComputerAddict (profile), Jun 28th, 2011 @ 9:11am

    Re:

    "Wow, I hope these guys aren't accountants, otherwise the business world is going to hell...Yup, research and development is their only operating cost. No other costs at all. The lights stay on by themselves, the admin people work for free in an office provided by the state, they don't have to pay taxes, and they most certainly don't have any other expenses except R&D."

    Maybe you should read the Article again, the $49 Billion was a net profit, not gross income. The article said they had other expenses like the $83 billion for marketing and administration. The $49 Billion was just Christmas bonuses for the people with offices on the top floor.

    Pharma is making nearly 20 times more in profit than any other Fortune 500 company any yet they are still asking for handouts from us.

     

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    ComputerAddict (profile), Jun 28th, 2011 @ 9:16am

    Re:

    I wouldn't, it's expensive.

     

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    Liberty, Jun 28th, 2011 @ 9:19am

    You people are downright morons who know literally jack shit about economics. You actually think you can blame the corporations?

    http://mises.org/daily/5359/The-Medical-Marketplace-Free-and-Unfree

    "So who's to blame? The answer: a system that has been developed by government intervention to interfere with consumer sovereignty and make every individual pay for every other individual's medical expenses so that the individual consuming the care does not bear the full price at the point of utilization."

     

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    Aerilus, Jun 28th, 2011 @ 9:20am

    I need some antidepressants now

     

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    Any Mouse (profile), Jun 28th, 2011 @ 9:20am

    Re: A different solution

    Many of the 'facts' in your link are in dispute. Have been for a while. For example, recycling paper creates MORE pollution, not less, and most virgin pulp is created from trees grown for the purpose, so you're not saving trees so much as costing jobs.

     

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    Any Mouse (profile), Jun 28th, 2011 @ 9:22am

    Re:

    Those operating costs are under Administrative costs, generally. Nice attempt, though.

     

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    Aerilus, Jun 28th, 2011 @ 9:37am

    Re:

    technically it shouldn't be that hard you just need enough money to pay salaries for a few doctors and a bunch of chemist for decade or two the thing that would make it hard is the bureaucracy (most of it probably sponsored by big pharma) that is in place and the tens of millions of dollars to get drugs through the fcc we are a country of liability and that is what holds us back more than the actual scientific or technical aspects of problems or at least as a science person that is how i see it a marketing or accounting person would probably have a different opinion and a lawyer would probably sue me for having the opinion

     

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    A Monkey with Attitude (profile), Jun 28th, 2011 @ 9:39am

    Re: Re: Re: Good to see a little populist outrage /here/.

    Sorry but i have to dis-agree.. if you read the writtings of the chairman or Pot, one of the key points they made time and time again was to use "weath" envy to sway the emotion of their base supporters... if you can give the people something to hate (in their case anyone with more than you have) then the people are willing to go to any means... Che also used similar tactics....

    I will grant you Mondragon is a great idea for a company, but as a government it leaves much to be desired (as if i disagree with a company i can leave... a county not as easy)

     

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    A Monkey with Attitude (profile), Jun 28th, 2011 @ 9:45am

    Re: A different solution

    You do realize that Aluminum Recycle and Steel Recycle are economically impractical on a large scale right? Because of infastructure and how its processed it costs more and takes longer to recycle those things than it does to go from ore to finished product?

    I clap to your effort and wish you the best, but until the economics are worked out it will be slow going (or some one starts researching better ways for the processes today).

     

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  47.  
    identicon
    Aerilus, Jun 28th, 2011 @ 9:48am

    Re: A different solution

    reuse>recycle asking why we are throwing things away and why they are not designed for reuse would go along way toward fixing the problem. recycling takes a lot of energy melting things down to a more impure state then totally re manufacturing them is not ideal

     

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  48.  
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    Anonymous Coward, Jun 28th, 2011 @ 9:53am

    Re: Re: Drug companies next in line for obsolescence

    However all they are really injecting is a single nano designed to reactivate the other nano's

     

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  49.  
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    Jacob Cooper (profile), Jun 28th, 2011 @ 10:20am

    Sorry, but companies making huge profits don't bother me. I also don't care how they spend their money.

    I'm also unsure about what you're advocating. Are you calling for less government intervention via funding and more intervention via profit regulation?

    And, yeah, I rely on several drugs that both extend and maintain a quality of life for me. So while you're stifling your vomit and expressing your rage, I'm thanking the pharma companies for the drugs they've brought to market.

     

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  50.  
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    The Devil's Coachman (profile), Jun 28th, 2011 @ 10:28am

    Re:

    Better hope there's a generic available. Otherwise, yer screwed. Then again, no matter how you slice it, yer screwed anyway.

     

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  51.  
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    The Devil's Coachman (profile), Jun 28th, 2011 @ 10:37am

    Re:

    And you appear to know jack-shit about big pharma. I know a lot more about it than you do, and for very good reason, but I won't waste any of my time attempting to educate you about what actually happens in the big pharma/greedy quack conspiracy on a daily basis. Suffice to say, they're both in it together, and the patient/consumer gets screwed into the ground, thus nullifying your horseshit about "consumer sovereignty". Patient care outcome has nothing to do with what the pill peddlers are looking for. It's all about the money, only the money, and always well be that way, and if they kill a few thousand patients after the "post-marketing" results come in, too bad. So take your Panglossian view of the medical care industry up the road and try to find some moron to buy into it. Not here, pal.

     

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  52.  
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    The eejit (profile), Jun 28th, 2011 @ 10:43am

    Re:

    Perhaps, but spiralling marketing costs have also played a not-0inconsiderabel part in that, as well.

     

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  53.  
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    The Devil's Coachman (profile), Jun 28th, 2011 @ 11:08am

    Re:

    Glad you can afford them. What kind of co-pays do you have for these wonder drugs? I also rely on several drugs that extend my life and maintain a quality of life for me, and some of the quality of life drugs are to offset the horrible and debilitating side effects of the life extending drugs.

    I make a decent income, have reasonably good group medical insurance, and the pharmaceutical co-pays in the aggregate are killing me financially. There are no annual caps on co-pays, and the PBMs hose you down mightily if it isn't a generic or in their formulary. And that's if they authorize the dispensing of the prescription, even if there are no alternatives available.

    I have one prescription held up in the "authorization" process for ten days now, and nobody is perturbed about that. The doctor wrote a valid prescription, for a drugs specific to my condition, and for which there is currently no generic alternative, although I would happily pay less for generic if it were. The PBM has yet to issue the "authorization number" to my doctor, in the hopes it will be forgotten, obviously. I could name the company, but they all seem to do exactly the same thing and for the same reasons,

    They drag their feet and stall in the hope that you'll simply give up and go away, or even better, die. They are a manifestly evil and amoral group of money grubbing thieves, and if you stand in the way of their profitability, then you need to die, and soon. Many people do just that, and it suits them fine. There are news stories aplenty about these situations, and even when it results in unnecessary patient death due to the fact that they need to maintain their profit margins, it bothers them not a whit.

    So where can I get insurance like you have, at a cost I can afford? I'd certainly like to sign up for it.

     

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  54.  
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    Ed C., Jun 28th, 2011 @ 11:19am

    Re: Re: Re: Re: Re: Good to see a little populist outrage /here/.

    Actually, I find that even low income conservatives treat being filthy rich as the "American Dream" TM, thus some sort of patriotic God-given right, and to deny anyone that right means denying them any future prospects of becoming filthy rich too. What they don't realize, of course, is that the filthy rich do more that anything to disparage not only their prospects of becoming even marginally wealthy, but a living wage as well.

     

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  55.  
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    Gabriel Tane (profile), Jun 28th, 2011 @ 11:37am

    Re: Re: Re: Re: Good to see a little populist outrage /here/.

    Actually, a number of insurance companies in the US do the same thing... make sure yours is a 'mutual company'. if they exceed the profit margin, the money goes back to the 'shareholders', which are the policy holders of that company.

     

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  56.  
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    BeeAitch (profile), Jun 28th, 2011 @ 11:48am

    Re:

    Then why do they claim such high R&D budgets?

     

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  57.  
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    BeeAitch (profile), Jun 28th, 2011 @ 11:57am

    Re:

    Obvious shill is obvious.

     

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  58.  
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    Cowardly Ryan, Jun 28th, 2011 @ 12:07pm

    Regulation springs to mind

    How to make cheap drugs? Eliminate the FDA.

    How to create community health centers? Eliminate the regulations that require doctors to prescribe medicine and perform tests.

    Get rid of all the paperwork and tele-medicine could take off. I'd take a cheap doctor from anywhere in the world that I could talk to at home over visiting an overworked doctor at a clinic where I'm exposed to all manner of unknown diseases.

    Yeah it's our own fault - start electing people who don't think government is the answer to anything but why things don't work.

     

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  59.  
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    Jacob Cooper (profile), Jun 28th, 2011 @ 12:10pm

    Re: Re:

    Guess I have it better than you do. Sounds like your life sucks. Enjoy it while you can.

     

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  60.  
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    Khory (profile), Jun 28th, 2011 @ 12:38pm

    Re: Re: Re: Good to see a little populist outrage /here/.

    I'm not opposed to them making money. They provide a product we use/need and the should reap some benefit from that.

    However, using underhanded tactics and leveraging the fact that some people need their medications to live is wrong. How many billions in profit is enough??

     

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  61.  
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    The Devil's Coachman (profile), Jun 28th, 2011 @ 1:06pm

    Pretty much a typical shithead response you gave there, Zippy. But then, I expected nothing less from a pinhead such as you. By the way, my life doesn't suck, but I bet everyone who knows you thinks you sure do. Have a nice pinhead day, Zippy.

     

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  62.  
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    The Devil's Coachman (profile), Jun 28th, 2011 @ 1:09pm

    Re: Re:

    Because lying is what they excel at! Especially when touting their new products' "effectiveness", while ignoring the products' comparisons to placebos, which in most cases is statistically insignificant improvement, if any.

     

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  63.  
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    Anonymous Coward, Jun 28th, 2011 @ 1:16pm

    US Health Care

    Health care in the US is only for those who can afford it. To keep it that way, the government is involved in order to circumvent free market forces that would otherwise undercut the "system" that makes it so. People are only allowed to obtain medical care from those that the government says they can, and only treatments that the government approves of. The US has a system where providers receive government protection in the market, but prices are then left unregulated. This has resulted the gouging seen today.

    The US need a new constitutional amendment: There shall be no law abridging a person's right to freely choose their own medical care.

     

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  64.  
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    Jacob Cooper (profile), Jun 28th, 2011 @ 1:48pm

    Re:

    Ha! I voted you 'funny', clown.

     

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  65.  
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    FormerAC (profile), Jun 28th, 2011 @ 3:38pm

    Re: Re: Re: Drug companies next in line for obsolescence

    Of course! That way the reactivation is pure profit.

     

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  66.  
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    Nicedoggy, Jun 28th, 2011 @ 4:04pm

    Re: Re: A different solution

    That is incorrect sir, at least aluminum recycling saves energy and costs.

    http://en.wikipedia.org/wiki/Aluminium_recycling
    http://www.epa.gov/osw/conserve/material s/alum.htm

    And I know any furnace will accept anything aluminum to be throw in, that is why the factories I know collect cans and any aluminum scrap they can find to recycle because once it is there at 900 degrees Celsius any paint, water or other contents mostly become air pollution.

    Steel is the same thing but the temperature inside the furnaces are even higher.

    Also it cost less to recycle aluminum, to extract it from ore is expensive in energetic terms, which makes it costly to get the raw material to finish product.

    So I need to ask, have you any study or studies corroborating your claims?

     

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  67.  
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    Nicedoggy, Jun 28th, 2011 @ 4:11pm

    Re:

    Will you also thank them for stopping others from manufacturing cheaper drugs?

    Will you also thank them for all the bogus studies they release?

    Will you also thank them for all the bogus trials?

    Will you also thank them for making so costly, that the future of your healthcare is in other countries that can do it cheaper? so you can travel there and still will be less expensive.

    Will you also thank them for making things more expensive than they need to be?

    I don't thank them for that, but if you want to, that is your option.

     

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  68.  
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    Jacob Cooper (profile), Jun 28th, 2011 @ 4:17pm

    Re: Re:

    Sorry, but the problem isn't the companies. The problem is the government. So, your "arguments" hold no water with me.

     

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  69.  
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    JMT, Jun 28th, 2011 @ 4:45pm

    Re:

    "One read of the story and you can see it's a wild attempt to slam pharma with half truths and misleading information."

    One read of your comment and we can see it's a wild attempt to defend an industry you have a vested interest in. Care to declare that vested interest?

     

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  70.  
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    Anonymous Coward, Jun 28th, 2011 @ 9:49pm

    Re: Re: Good to see a little populist outrage /here/.

    "But that's socialism!"

    The U.S. is already a corporate socialistic society. Free market capitalism? Hah, the government grants monopolies on practically everything around us. From taxi cab monopolies to cableco monopolies to broadcasting monopolies to mailbox delivery monopolies to electricity delivery monopolies to IP monopolies, the list goes on and on.

     

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  71.  
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    Richard (profile), Jun 29th, 2011 @ 6:22am

    Re:

    "So who's to blame? The answer: a system that has been developed by government intervention to interfere with consumer sovereignty and make every individual pay for every other individual's medical expenses so that the individual consuming the care does not bear the full price at the point of utilization."

    I can tell that you come from a country that has never been engaged in a serious war that affected the civilian population.

    (At least in living memory).

    If you did you would realise that we all have to take some responsibilty for each other.

    The vast majority cannot afford to pay the cost of modern healthcare at the point of utilisation and most cannot afford to pay for insurance if it is provided privately. That is at least in part because private insurance companies are too weak to deal with the difficult situations that arise when the insured gets sick and the drug companies ask for money.

    Where the state provides the insurance it hold more bargaining chips to face down the drug companies.

    Unfortunately the existence of the US healthcare system creates unaffordable drugs that cause problems for everyone else. You really need to sort you system out....

     

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  72.  
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    Richard (profile), Jun 29th, 2011 @ 6:31am

    Re: US Health Care

    Nah - the simple solution is for the government to stop just regulating and actually pick up the tab (as in the UK) that way they have an incentive to keep the costs down....simples.

    Frankly we look over the "pond" at the US healthcare system and just can't believe it. Over here we have decided that we want free high quality care for all - and what is more we are prepared to pay the necessary taxes to get it.

    There are arguments about how to keep the costs down but even the current Conservative PM (who is a man of independent wealth) realises the value of the NHS which cared for his disabled child over the years in a way that even he could not have afforded as an invdividual.

     

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  73.  
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    anymouse (profile), Jun 29th, 2011 @ 12:04pm

    Re:

    You seem to be confused with numbers and facts....

    I don't see anybody claiming that there aren't 'other'costs, only that comparing R&D expenditures ($41b) to their profit ($49b) shows that they make more than they spend on R&D.

    To anyone normal common business sense, here's a very simple formula: Total Revenue (X) - Total Expenses (Y) = Profit (Z)

    So lets do some math with the variables we know and don't know:
    X is unknown,
    we know a portion of Y ($41b R&D + $83b Marketing),
    we know Z ($49B)

    So X - (Y + 41b + 83b) = 49b, all we can reliably determine from this data is that Total Revenue was at least $173b, that profit exceeded total R&D expenses by $8b, and that total revenue exceeded total expenses by $49b.

    So the companies that are complaining about how expensive R&D is and how the government need to 'save them', are spending more than twice as much on marketing as they are on R&D (how much of this is lobbying for new laws to 'protect' their industry that's dying due to excessive R&D costs), and are recording profits in excess of their R&D expenses....

    This seems to indicate that R&D is not quite the 'boogeyman' to the Pharma industry that they claim it is... does this sound a little too much like the **AA's and 'piracy' to be a coincidence?

     

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  74.  
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    Bobby K, Jun 29th, 2011 @ 12:54pm

    Re: Re: Good to see a little populist outrage /here/.

    The problem is the socialism to begin with--the corporate socialism, as the article has pointed out.

    Just end the existing subsidies (socialism).

     

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  75.  
    identicon
    Lee Graczyk, Jun 29th, 2011 @ 3:26pm

    Regardless of how Big Pharma claims it is spending its funds, as this article points out, the prices of prescription drugs in the U.S. are exorbitant. We regularly hear about seniors who have to choose between their vital maintenance medications for conditions such as diabetes, high blood pressure and high cholesterol, and buying groceries for the week.

    RxRights is a national coalition of individuals and organizations dedicated to promoting and protecting American consumer access to sources of safe, affordable prescription drugs. The Coalition is encouraging consumers to take action now by sending letters to President Obama and Congress urging them to protect our right to safe, affordable medications. For more information or to voice your concern, visit www.RxRights.org.

     

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  76.  
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    hegemon13, Jun 30th, 2011 @ 8:49am

    Re: Good to see a little populist outrage /here/.

    Nope. That would do nothing. The problem we have are not due to a lack of regulation, but to over-regulation. Allow real competition, and most of our problems go away. The problems we see are a result of the FDA, and the fact the big pharma can literally buy their approvals with "user fees." If a small clinic comes up with a life-saving cure, their FDA trials will be relegated to the far future or never, while Pfizer's next iteration of Viagra gets approved within four to six months. Why? Big pharma gets to pay user fees to the FDA to get their drugs to be first on the docket. User fees are now more than half the revenue of the FDA. They have raised the cost of drug approval to ridiculous levels so that only the established, monolithic corporate players have any chance of ever getting a drug into testing at all, let alone approved. Everyone else just gets pushed back indefinitely.

    Increasing the level of regulation, as you suggest above, would only increase the opportunity for corruption. Already, government power has led to massive, systemic corruption and the continued transfer of wealth from the general public to a few elite. Allowing income caps would complete the equation, allowing the government to seize ALL the income they want from individuals and transfer it to the few that they deem as "exceptions." As long as the government has power, that power will be corrupted. The downward spiral of pharmaceutical advancements is the direct result of the increasing power of the FDA. Competition and consumer choice is an EXTREMELY powerful control. The government has essentially eliminated that control, and taken it upon themselves to determine what medical advancements are allowed to be made. And how do they decide it? By the potential impact of the new drug? Nope. By user fees. In other words, "how much will you pay us."

     

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  77.  
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    hegemon13, Jun 30th, 2011 @ 9:03am

    Re: you can't compete agains Big Pharma..

    Just watched this myself. Anyone who thinks government controls and regulations are the answer needs to see this movie. If it doesn't change your mind, you are a victim of a nationalistic version of Stockholm's syndrome, and you enjoy being abused by your powerful overlords.

     

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  78.  
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    Jose_X, Jul 1st, 2011 @ 12:57pm

    Marketing research, patent deal payments, etc.

    There are probably many things that fall into "research and development" that have nothing to do with actually innovating at a technical level or doing what most academics would consider to be basic research.

     

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  79.  
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    bare, Jul 2nd, 2011 @ 4:14am

    Corporatism

    The main reasons why we have artificial scarcity and thus higher costs are patents, other IP protection, biased and really stupid regulation, and other monopoly corporatist protection, often authored by agents of psychopathic corporations. The very idea of a corporation and limited liability was dangerous, and was completely broken when they gained 'legal' but fraudulent and immortal person-hood.

    Regulatory capture is the main reason why the developed countries are in trouble and heading for another Depression. Not only are select corporations allowed exceptions from regulations, they are even legally allowed to do things which honest and informed people would see as plainly unlawful e.g. fraud and deception.

     

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  80.  
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    Mad Maxx, Jul 4th, 2011 @ 11:23am

    Re: Re: A different solution

    Thanks for taking the time to comment on the googlegroup! I personally believe that this is a path to my personal non-monetary wealth - and giving it away as I intend to keep doing is a way to encourage others to do the same. if that happened even on a small city sized scale (10k to 50,000 participants - the "market" will start to look pretty silly to their friends and neighbors ;-)

    James

     

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  81.  
    identicon
    MadMaxx, Jul 4th, 2011 @ 11:43am

    Re: A Different Solution

    Sorry, I have no "official" Stats - only my own experience with re-formed plastic from milk cartons (94%) and other HDPE plastic containers, aluminum (98%) steel (90%) I have not tried glass, paper, or lumber... yet

    Yard waste is 100% since I don't use herbicides or pesticides and do not have a lawn. I'm going for a "closed loop" lifestyle as much as possible on a personal level - with a long term goal of adequate fabrication resources to maintain a comfortable lifestyle with minimal additional inputs within 5 years. and no hair-shirt back-to-the-land self deprivation, either just a sensible alternative to relying in the constant purchasing of expendable junk...

     

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  82.  
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    Gabriel Tane (profile), Jul 5th, 2011 @ 7:29am

    Re: Re: Re:

    I'd be interested to read an explanation on how the government is the problem, in your opinion. Especially since "it's the government's fault" doesn't really answer the points that Nicedoggy brought up.

     

    reply to this | link to this | view in thread ]


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